Broker guide
Mortgage Broker Compliance Checklist 2026
Reviewing a mortgage file? Use a mortgage broker compliance checklist to connect disclosures, responsible lending, best interests and document retention.
- Published
- Updated
Use this mortgage broker compliance checklist to check that your file explains the loan recommendation and contains the supporting records. Work through it from the first client contact to submission and file retention.
Having every document on file isn’t enough if the details don’t match. Check that the records describe the same loan and show when each step happened.
Open the Engagement
Open the review by confirming the file shows who your client is, what they asked you to do and which documents you gave them. Date every item so a reviewer can see it came before the step it had to precede.
- Each borrower and guarantor was verified to the lender’s verification of identity standard, with the date and the name of the person who did it.
- Your privacy collection notice went to your client, and the file holds any consent the lender’s application needs. Australian Privacy Principle 5 sets when a collection notice is due and what it must cover.
- A file note records what your client asked you to help with, such as a purchase or refinance, and anything they asked you to leave out.
- Every credit guide your client needed, any credit quote and the credit proposal disclosure document are on file, each with the date and method of delivery.
Credit Guide, Credit Quote and Credit Proposal Disclosure
The credit guide is due as soon as practicable once it’s apparent you’re likely to help your client with a loan. Your client must accept any credit quote before you suggest a particular loan or help them apply for it. The credit proposal disclosure document goes out at that same step.
The Australian Securities and Investments Commission (ASIC) sets out these documents in its overview of the disclosure obligations. The section numbers in the table come from the National Consumer Credit Protection Act 2009 (National Credit Act). Section 113 puts the credit guide duty on the licensee, which is the business whose Australian credit licence you work under.
If you’re a credit representative, meaning a broker the licensee has authorised to act under its licence, section 158 adds a second guide. You must give your client your own credit guide at the same time as the licensee’s. It must show your credit representative number, the licensees you act for, your estimated commissions and how your client can reach the Australian Financial Complaints Authority (AFCA).
| Document | When it’s due | What to check | What to keep |
|---|---|---|---|
| Licensee’s credit guide (section 113) | As soon as practicable after it becomes apparent you’re likely to help your client with a loan | The Australian credit licence number, fees and charges, estimated commissions and the lenders the licensee does the most business with (up to six), plus contact details for its internal dispute resolution process and AFCA | The version your client received and the delivery record |
| Credit representative’s credit guide (section 158) | At the same time as the licensee’s credit guide | Your credit representative number, fees and charges, the licensees you act for (up to six), your estimated commissions and AFCA contact details | Your credit guide as your client received it, with its delivery record |
| Credit quote (section 114) | Before you suggest a particular loan or help your client apply for one, and your client must sign or otherwise accept it | The maximum amount your client will pay for your services, what it covers and whether it’s payable if no loan proceeds | The accepted quote and the copy you gave your client |
| Credit proposal disclosure document (section 121) | At the same time you suggest, or help your client apply for, a particular loan with a particular lender | The fees your client pays you, the estimated commission and the estimated lender and third-party fees. If the loan pays those costs, the credit left after them | The final version as your client received it, with its delivery record, matched to the loan you lodge |
Regulation 28C of the National Consumer Credit Protection Regulations 2010 (National Credit Regulations) lists two cases that need no credit quote. One is a licensee credit guide stating that the licensee charges consumers no fees or charges for its services. You also don’t need one when you don’t intend to charge your client and the credit proposal disclosure document states that no fee was charged.
Under regulation 28P, a licensee or credit representative doesn’t need to repeat a credit guide it gave your client in the previous 12 months. This applies only while the AFCA contact details haven’t changed. Keep the earlier delivery record so a reviewer can see why no new guide went out.
If you’re a franchisee of the licensee, regulation 28P also removes the need for your own credit guide when your franchise agreement binds you to the licensee’s policies. For this exemption, the licensee’s credit guide must say that the licensee takes responsibility for your credit activities.
Compare every figure with the recommendation. If the lender, product, loan amount or your fee changed after a document went out, keep the earlier version, any replacement and a file note of what changed. Store them beside the recommendation so a reviewer can match each figure to the loan you lodged.
Delivery evidence is the signed acknowledgement, email or portal record. If you don’t hand a document to your client in person, regulation 28L requires you to be reasonably satisfied they received it before you continue with their loan.
If you make documents available through a portal, the same regulation needs your client’s consent, given after they’ve been told what electronic delivery means. Keep that consent with the delivery records. The credit guide article covers the guide’s contents in more detail.
Getting Outside Compliance Help
An external compliance provider can give you mortgage broker compliance support, but the licensee still owns the outcome. ASIC’s Regulatory Guide 205 (RG 205) on general conduct obligations lists periodic compliance reviews of representatives among the functions licensees commonly outsource. RG 205 also says a licensee that outsources a function stays responsible for its obligations.
A provider can test your disclosure templates against the current National Credit Act and National Credit Regulations. It can also sample completed files, report each defect with its evidence and suggest changes to your review procedure.
You and the licensee keep ownership of decisions about your client, file corrections, escalation to the licensee’s compliance manager and the evidence itself. Record who reviewed each file, what they tested and who accepted each finding. The compliance services guide sets out what to ask a provider before you engage one.
Support the Recommendation
A recommendation is supported when a later reviewer can trace it from your client’s goals, through your inquiries and verification, to the proposed loan and the options you compared. Write that path down as you go. ASIC’s RG 273 on the best interests duty says notes drafted only at the end may not capture your reasoning as accurately as notes taken along the way.
- The file records your client’s requirements and objectives in their words, with priorities such as an offset account or a repayment limit.
- File notes show the questions you asked and the documents you checked, linked to the preliminary assessment they support. The preliminary credit assessment guide covers that evidence in detail.
- The file names the loan types or lenders you compared and why the proposed loan fits better.
- Any conflict you identified, such as a commission difference, sits beside the step you took to put your client’s interests first.
- A short narrative summary connects these records into one explanation.
Both file notes below are fictional. The first leaves a reviewer guessing, and the second shows the path from goal to choice.
| Version | Fictional file note | What a reviewer can tell |
|---|---|---|
| Incorrect | “Best rate, client happy.” | Nothing about what your client wanted, what you compared or why this loan won |
| Correct | “Client wants an offset linked to two savings accounts holding $40,000. Compared variable loans with offset at Lender A and Lender B. Chose Lender A because only its offset links to two accounts.” | The goal, the loans compared and a reason drawn from your client’s objectives |
These records show how you met the best interests duty and the conflict priority rule in sections 158LA, 158LB, 158LE and 158LF of the National Credit Act. Under that rule, you give your client’s interests priority when you know, or reasonably ought to know, that they conflict with your interests or the licensee’s. The best interests guide explains what the duty requires in practice.
Apply Responsible Lending Controls
A credit licence responsible lending policy works in a file review only when each rule points to a record the reviewer can open and a checkpoint they can test. Label each check by its layer in the table below so statutory mortgage broker compliance requirements stand apart from licensee procedures and optional controls. A missing statutory record carries more weight than a skipped internal step.
| Layer | Example rule | File record | Review checkpoint |
|---|---|---|---|
| Statutory obligation | Make reasonable inquiries about your client’s requirements, objectives and financial situation (section 117) | Completed fact find (the questionnaire that records your client’s circumstances) and file notes | Every question answered or marked nil |
| Statutory obligation | Take reasonable steps to verify your client’s financial situation (section 117) | Income, expense and liability evidence | Each figure in the preliminary assessment traces to a document |
| Statutory obligation | Make a preliminary assessment within 90 days before you suggest the loan or help your client apply (sections 115 and 116) | Dated preliminary assessment covering the proposed period | The preliminary assessment date falls within 90 days before the suggestion and the application |
| Statutory obligation | Be able to give your client a written copy of the preliminary assessment (section 120) | Preliminary assessment kept in a form you can produce | The reviewer can open the preliminary assessment itself as well as its inputs |
| Licensee procedure | Your licensee’s verification standard, such as which documents prove self-employed income | Documents listed in the procedure | Documents match the procedure version in force on that date |
| Optional quality control | Second-person review before lodgement | Reviewer name and date | Sign-off recorded before the lodgement date |
A missed licensee procedure breaks your licensee’s rules and can also leave a statutory gap, so check both. A skipped optional control is a training note unless the licensee procedure makes it mandatory.
For each row, the reviewer confirms the evidence exists and is dated. ASIC’s RG 209 on responsible lending conduct calls it good practice to answer every fact find question, even with nil or not applicable. The responsible lending guide explains how far reasonable inquiries need to go for your client’s circumstances.
Check Before Submission
Before you lodge the application with the lender, confirm nothing has changed since your client accepted the recommendation and that a named person has approved every open item. Work through these checks in order.
- Confirm the preliminary assessment was made within 90 days before the day you help your client apply.
- Match the credit proposal disclosure document to the lender, product and loan amount in the application, or record why a new amount leaves its fee and commission estimates unchanged.
- List outstanding conditions, such as a valuation or a missing payslip, each with an owner and a due date.
- Record your client’s confirmation of the application details and declarations, with the date they gave it.
- Where your licensee requires sign-off, such as for a new broker, note who approved the file for lodgement.
If the lender or product changes, you’re suggesting a different loan. Update the preliminary assessment before you suggest it, and give your client a new credit proposal disclosure document when you do.
If only the loan amount changes, recheck whether your client can still afford the repayments and whether the fee and commission estimates in the credit proposal disclosure document still hold. Then record the result beside the recommendation.
Retain the Credit File
The final credit file is the version a reviewer, your client or ASIC could ask for later. Your credit licence document retention policy decides who holds it, who can open it and how long it’s kept. Mark one version as final and label replaced versions so no one mistakes them for it.
RG 273 doesn’t give one retention period for the whole credit file. It says the right period can depend on the loan term, any interest-only period and whether your client refinances. It also warns that short retention can leave you unable to show how you complied.
Three requirements, as at September 2026, decide what you must still be able to produce years later. Check your retention policy against each one.
| Requirement | Source | What it means for the file |
|---|---|---|
| Your client can request a copy of the preliminary assessment within 7 years of the credit quote date | Section 120 | Keep the preliminary assessment ready to send free of charge, within 7 business days if the request comes within 2 years of the quote and 21 business days after that |
| Keep all material that forms the basis of the preliminary assessment | Licence condition described in RG 209.255 | Keep the inquiry and verification records as well as the finished preliminary assessment |
| Keep financial records for 7 years after the transactions they cover are completed | Section 95 | Keep commission and fee records on the same schedule |
RG 273 lists the records ASIC generally expects a mortgage broker to keep. Use it to confirm the final file is complete.
- the preliminary assessment, or the documents used to prepare it
- the credit guide your client received
- information given to the lender and the application outcome
- relevant conversations with your client
- evidence that you acted in your client’s best interests
- the options, the final recommendation and the reasons for it
- any conflict of interest and the action you took
Name the access owner as a role, such as the licensee’s compliance manager, so the duty survives staff changes. That role answers your client’s section 120 request and approves access to the archive. For the organisation-wide schedule, archive access and secure disposal, use the mortgage broker information security guide.
Audit a Completed Mortgage Broker File
To audit a completed mortgage broker file, test each stage against a written pass criterion, grade every defect and give each fix an owner. The template below covers one file from first contact to closure.
| Area | Test | Pass when |
|---|---|---|
| Disclosures | Every credit guide, any credit quote and the credit proposal disclosure document were given on time | Each is dated before or at its trigger, with delivery evidence |
| Inquiries | Your client’s requirements, objectives and financial situation were explored | The fact find is complete and file notes record your client’s answers |
| Verification | Income, expenses and liabilities were checked | Each assessed figure traces to a document |
| Serviceability | The lender’s calculator result showing whether your client can afford the repayments is on file | The inputs match the verified figures and the output is dated |
| Policy citations | The lender policy relied on is identified | The policy source and its date or version are recorded |
| Alternatives | Other loan types or lenders were considered | The file names them and says why they weren’t chosen |
| Recommendation reasons | The reasons connect to your client’s objectives | A reviewer can follow the narrative summary without asking you |
| Submission versions | The lodged application matches the disclosed loan | Lender, product, amount and fees agree across the documents |
| Closure evidence | The outcome was recorded and the file closed | Settlement or decline, notice to your client and commission received are on file |
For a lender-policy decision, save the question, lenders considered, quoted wording and review date with the file. Bulma lets a broker copy its quoted policy answer and sources into file notes. Record who checked the wording and which decision it supported.
Sampling Files for Review
Your licensee’s compliance manager chooses files by risk as well as at random. RG 273 describes a licensee that selects brokers for review by business volume and by the variety of lenders and products they use. It also weighs complaints and how each broker’s loans perform.
The compliance manager adds targeted samples for new brokers, unusual loan types and any area where the last audit found defects. The audit report records why each file was chosen so the next audit can compare like with like.
Pass Criteria and Defect Severity
A file passes when it has no critical or major defects. The severity scale below is an example, and your licensee sets its own.
| Severity | Example | Response |
|---|---|---|
| Critical | A preliminary assessment older than 90 days at application, or a missing credit proposal disclosure document | Escalate to the compliance manager the same day and check whether it’s a reportable situation |
| Major | Verification below the licensee’s procedure, or a credit proposal disclosure document whose figures don’t match the lodged loan with no file note explaining why | You correct the file within an agreed time and the compliance manager confirms the fix |
| Minor | An undated file note or a missing delivery record that can be recovered | Written feedback and a check in the next sample |
A pass means the file shows the evidence this checklist asks for. It doesn’t certify compliance or settle a disputed legal question, which belongs with the compliance manager or a lawyer.
Escalation and Corrective Ownership
The audit report names three owners for every defect, each responsible for a different part of the response.
- You correct the file.
- The compliance manager decides whether the defect is a reportable situation.
- The procedure owner changes the template or training when a defect repeats.
Under section 50A of the National Credit Act, a reportable situation includes a significant breach of a core obligation, gross negligence or serious fraud. Core obligations include the licensee’s general conduct duties in section 47 and your own duties under the Act. Section 50B requires the licensee to report it to ASIC within 30 days of first knowing there are reasonable grounds to believe it has arisen.
ASIC’s RG 78 on breach reporting explains how to assess whether a breach is significant. The compliance manager records that assessment on the audit report, with the date it was made.
When there are reasonable grounds to suspect your client has a recoverable loss from a significant breach, gross negligence or serious fraud, sections 51A and 51B set further deadlines. Within 30 days of first knowing the facts, the licensee must start an investigation. In the same period, it must take reasonable steps to notify your client in writing.
The investigation must finish as soon as reasonably practicable. Within 10 days after it finishes, the licensee must take reasonable steps to give your client written notice of the outcome. Where the investigation finds reasonable grounds to believe your client has a recoverable loss, the licensee has 30 days after it ends to take reasonable steps to pay that amount.
How Recurring Defects Change Procedures and Training
A defect that repeats across brokers points to a gap in the procedure, so the licensee fixes the procedure and the training as well as each file. Harbour Lane Finance, a fictional licensee with eight brokers, shows how this works.
In one quarter, its compliance manager audits 16 completed files, two per broker. In five of the 16 files, the credit proposal disclosure document shows a different loan amount from the lodged application because the amount changed after valuation.
Harbour Lane’s procedure requires a corrected document whenever the amount changes, so the compliance manager grades each of the five files as major. Each broker issues a corrected one and records the change. Three files also have undated file notes, graded minor.
The mismatch appears across four brokers, so the compliance manager treats it as a procedure gap rather than five separate errors. The procedure owner adds a pre-lodgement step that compares the loan amount in the application with the credit proposal disclosure document. The next team training walks through a file where valuation changed the amount.
The following quarter, the audit samples six files where the amount changed after valuation, and all six pass. The new pre-lodgement step caught each changed amount before the file went to the lender.
When a defect repeats, the procedure owner records the fix in the licensee’s compliance manual. The mortgage broker compliance manual guide shows where the procedure behind each check belongs. Before you lodge each application, run the first four sections on its file, and keep each closed file ready for the compliance manager’s next audit sample.
